Transcript Corporate Control of Public Health: Case Studies and Call to Action Martin Donohoe.

Corporate Control of Public Health:
Case Studies and Call to Action
Martin Donohoe
Am I Stoned?
A 1999 Utah anti-drug pamphlet warns:
“Danger signs that your child may be
smoking marijuana include excessive
preoccupation with social causes, race
relations, and environmental issues”
Corporations Dominate the Global
Economy
Almost 6 million corporations
90% of transnational corporations
headquartered in Northern
Hemisphere
500 companies control 70% of world
trade
Corporations Dominate the Global Economy
• 53 of the world’s 100 largest economies
are private corporations; 47 are countries
–Wal-Mart is larger than Israel and
Greece
The Stock Market
• The top 1% of Americans owns 35% of all
stocks, bonds, and mutual fund assets
• Consequences of Differential Stock Ownership
– Corporations are answerable to their
shareholders
– Governments are answerable (at least in
theory) to their citizens (either through
elections or revolutions)
Corporations
• Internalize profits
– $2.1 trillion (2013)
• Externalize health and
environmental costs
Corporate Taxation
• Corporations shouldered over
30% of the nation’s tax burden in
1950 vs. 8% today
• Nearly 1/3 of all large U.S.
corporations pay no annual tax
Corporate Taxation
• Big business claims that U.S. corporations
pay the highest corporate taxes in the
world (35%)
• FALSE: The rate actually paid, after
foreign governments get their cuts,
money sent to foreign subsidiaries,
loopholes, etc. = 2.3% (U.S. Treasury
Department)
Reasons for Inadequate Corporate Taxation
• Corporate tax breaks/loopholes
• Corporate welfare
• Cheating and under-payment common
• Offshore tax havens shelter capital
Ugland House, Cayman Islands
18,000 Corporations Registered Here
Job Creators?
Corporate Taxation
• 2004: Bush administration offered temporary
tax holiday on foreign earnings
– $300 billion in profit repatriated
• 92% went to dividend payouts, stock
buybacks, and corporate coffers
• Only 8% went to R and D, new factories,
and hiring
Exorbitant CEO Pay
• The average CEO makes 331X the salary of the
average U.S. worker (1960 - 41X)
– Mexico 45:1
– Britain 25:1
– Japan 10:1
– US Military: 20:1 (top rank : lowest rank)
– US ratio of average CEO to minimum wage
worker = 774:1
Exorbitant CEO Pay
• Median U.S. CEO salary (for S and P 500
corporations) = $11.7 million (2014)
• CEO salaries up 937% since 1978
–Average worker pay up 10%
Exorbitant CEO Pay
• The average CEO makes 250-400X the salary
of the average U.S. worker (1960 - 41X)
– Mexico 45:1
– Britain 25:1
– Japan 10:1
– US Military: 20:1 (top rank : lowest rank)
The Mega-Rich
• Worried / Investing in personal security
– Bodyguards
– Armored cars
– Bullet-proof windows; machine gun proof doors
– Home security fogs
– Panic rooms
– Fully-stocked home medical suites
– Yachts with escape submarines
– Islands
Corporate PR Tactics
• Advertising
– “The art of convincing people to spend money
they don't have for something they don't need.“
(Will Rogers)
• Astroturf - artificially-created grassroots
coalitions
• Corporate front groups
• Corporate espionage: spying, bribes
Corporate PR tactics
• Invoke poor people as beneficiaries
• Characterize opposition as “technophobic,”
anti-science,” and “against progress”
• Portray their products as environmentally
beneficial despite evidence to the contrary
• Host all-expense paid educational seminars for
federal judges
Public Relations
• $200 billion industry
• PR flacks now outnumber journalists
Greenwash
• Public relations / ad campaigns
– BP invests $100 million annually in
clean energy = amt. it spends
annually to market itself as moving
“Beyond Petroleum”
Sponsored Environmental
Education Materials (Examples)
 International Paper
-“Clearcutting promotes growth of trees that
require full sunlight and allows efficient site
preparation for the next crop”
 Exxon’s “Energy Cube”
-“Gasoline is simply solar power hidden in decayed
matter”
-“Offshore drilling creates reefs for fish”
Sponsored Environmental
Education Materials (Examples)
• American Coal Foundation’s “Power from
Coal”:
– “The earth could benefit rather than be
harmed from increased carbon dioxide.”
Academics/Professional Organizations
Affected
• Increasing corporatization of academia
–For-profit schools
–Charter schools
–Educational corporations
Academics/Professional Organizations
Affected
–↑Private commercial funding of
university research
• Front-end domination and rear-end
repression affect research agenda,
dissemination of knowledge
• Undone science
• Secrecy/gag clauses
Academics/Professional Organizations
Affected
• For-profit colleges growing, marked by
corruption, high interest rates on loans to
the un- and under-qualified
–Benefit largely from taxpayer money
• Dramatic decrease in tenured faculty, rise
in administrators
• Gagging of researchers at federal
agencies demoralizing, can affect
recruitment of quality scientists
Union of Concerned Scientists (2015)
The Media
• 5 corporations control majority of US
media (down from 50 in 1983)
• Extensive corporate-media links
Global Warming: Controversial?
• Of 928 articles in peer-reviewed scientific
journals, none were in doubt as to the
existence or cause of global warming
• Of 636 articles in the popular press (NY Times,
Washington Post, LA Times, WSJ), 53%
expressed doubt as to the existence (and
primary cause) of global warming
Science 2004;306:1686-7
(Study covers 1993-2003)
Lobbying
• Approximately 40,000 lobbyists (11,781
full-time)
• Estimates of return on lobbying range
from $28 to $100 for every $1 spent
Lobbying
• Federal lobbying groups spent $3.2
billion in 2014
• All single issue ideological groups
combined (e.g., pro-choice, antiabortion, feminist and consumer
organizations, senior citizens, etc.) spent
well under $100 million
Top-Spending Industries, 2014
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Pharmaceutical industry - $230 million
Business Associations - $163 million
Insurance industry - $151 million
Oil and gas industry - $141 million
Computers/Internet - $140 million
Electric utilities - $122 million
Campaign Cash and Lobbying
• Citizens United
• McCutcheon v. Federal Election
Commission
• Lobbying promotes international noncooperation/isolationism
Case Studies
The alliance between GE Medical
Systems and NY-Presbyterian
Hospital
General Electric
• Ranked by Forbes as world’s largest company
(based on equal weighting of sales, profits,
assets, and market value)
• 2014 revenues of $149 billion
– Close to the GDP of more than 2/3 of U.N.
member states
2014 net after-tax profits of $15.2 billion
• Majority from overseas operations
General Electric
• Makes household appliances, lighting,
and medical equipment
–Plastics division, which produced
bisphenol A, spun off in 2008
• Produces jet engines and military
hardware
General Electric
• Charles Wilson (CEO of GE pre- and post-WW
II; helped oversee U.S. military production
during WW II):
– “The revulsion against war…will be an almost
insuperable obstacle for us to overcome. For that
reason, I am convinced that we must begin now to
set the machinery in motion for a permanent
wartime economy.”
General Electric
• Has built 91 nuclear power plants in 11
countries (including the troubled
Fukushima Daishi plants in Japan)
–Including 23 plants at 11 sites in U.S.
• e.g., Hanford
–¼ of GE’s US reactors found to be
defective
General Electric
• Operates coal-burning power plants
–Major releasers of toxic mercury
• Produces nearly 40 technologies used in
fracking
–Increasing investments in fracking
General Electric
• Operates a large financial services group
– Responsible for over 50% of company’s profits in
recent years
– 2015: company plans to sell off majority of GE
Capital (now Syncrhony Financial) over next 2
years
– Under investigation by the Justice Department for
over potential bankruptcy violations
General Electric
• Until recently, owned 49% of a multibillion dollar media empire
–Including NBC, Telemundo, and
Universal Studios
–Comcast owned 51%; bought out GE in
2013
GE’s History
• Conducted unethical human subject
experiments on prisoners, involving
testicular irradiation, from 1940s to
1960s
• Intentionally-released excessive radiation
from its Hanford, WA nuclear reactor in
the 1980s, to determine how far it would
travel
GE’s Record
• Sued radiologist who brought to light dangers
of GE’s contrast agent, Omniscan
– Causes nephrogenic systemic fibrosis (FDA black
box warning)
• Ordered to pay $11.4 million to Bracco
Diagnositcs for falsely/misleadingly claiming
that its x-ray contrast agent Visipaque was
superior to BD’s Isovue
GE’s Record
• America’s largest corporate polluter
• 116 Superfund sites nationwide
• Approximately 13 in NY
GE’s Record
• Between 1947 and 1977, two of its capacitor
manufacturing plants dumped at least 1.3
million pounds of PCBs into the Hudson River
– Probable human carcinogens with adverse
effects on liver, kidney, nervous system, and
reproductive organs (EPA)
– 200 mi of Hudson = Superfund site
GE’s Record
• Eliminated 34,000 US jobs between 2000
and 2010
• Added 25,000 overseas jobs over same
period
–One of nation’s top out-sourcers of
jobs
GE’s Record
• Cited by Human Rights Watch for
“systematic workers’ rights violations” in
the U.S. and abroad
• Extensive record of tax violations,
military procurement fraud
GE CEO Jeffrey Immelt
• 2014 total compensation = $37.2 million (up
from $25.8 million in 2013)
• Named “World’s Best CEO” in 3 separate
Barron’s polls
• 2006 - 2011 - On Board of NY Federal Reserve
Bank
GE CEO Jeffrey Immelt
• 2008 – Named one of the “100 Most Influential
People in the World” by TIME Magazine
• 2009 - Appointed by President Obama to his
Economic Recovery Board
– GE then became eligible, via a loophole, for ¼ of
the $340 billion Temporary Liquidity Guarantee
Program (debt support)
GE CEO Jeffrey Immelt
• 2011 - Appointed by Obama as Chair of his
outside panel of Economic Advisors and of his
Council on Jobs and Competitiveness
• On the board of directors of “The Robin Hood
Foundation”!
GE’s Record
• Named “America’s Most Admired
Company” by Forbes
• Named one of the “World’s Most
Respected Companies” in polls
conducted by Barron’s and The
Financial Times
Concerns About the Agreement between GE
Medical Systems and NY-Presbyterian Hospital
(2003)
• Provides GE with financial incentives to
promote high technology purchases
• Hospital prohibited from purchasing
more effective equipment from other
companies
Concerns About the Agreement
• Augments trend in academic medical centers
to promote the use of expensive, hightechnology care at expense of preventive care
and public health measures
– Highly reimbursable
– Services may be redundant in certain
locations
Concerns About the Agreement
• Patients with developmental anomalies
and cancers caused by GE’s pollution
diagnosed with GE scanners and treated
with GE-manufactured therapeutic
devices, increasing GE’s profit
A macabre twist on “cradle to
grave care”
The American Council on Science and
Health
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Corporate Front Group
Promulgates unsound science
Pro-corporate agenda
Major media presence
– Medical director spent time in federal
prison for Medicaid fraud, perjury, and
obstruction of justice
• Threatened to sue me, Medscape over
allegations in article on global warming
WHO Tobacco Treaty
• U.S. attempted to undermine treaty
through Bush administration
appointees with strong ties to
tobacco industry
Medical Technologies Industry
• Successful lobbying effort against
Medicare physician payment policies
relevant to unproven imaging studies
• Whole body CT scans (scams)
Drug Testing
• 2011: Florida Governor Rick Scott (R) issues
executive order requiring drug tests on
current state workers and new applicants
• 2011: Scott signs bill requiring drug tests for
TANF program
– positive test allows parent to choose
another individual to receive benefits on
behalf of children
– Aid recipients responsible for cost of tests
Drug Testing
• Florida Governor Rick Scott
– Former CEO of Columbia/HCA
– Fired after presiding over massive Medicare
fraud that cost corporation $1.7 billion
federal fine
– Then set up Solantic (FL chain of emergency
care clinics); transferred ownership to his
wife upon entering statehouse
• Solantic is in the drug-testing business!
Corporate Agribusiness
• Successful campaign against Oregon’s
Proposition 27 (labeling of GM foods)
• Lobbying for pre-emptive labeling laws re
GMOs, rBGH
Corporate Agribusiness
• Supports spread of GMOs to developing
world
• Keeps GM seeds from non-corporate
academic researchers
• Promoting agriculture bills which provide
large subsidies to large industrial farms
Prison-Industrial Complex
• Construction and management of prisons
• Providing (substandard) health care to
inmates
Health Insurance Industry
• Dubious practices:
– Delisting
– Cherry picking
– Pre-existing conditions
• Often lower quality of care
• High administrative costs
– 15-30% (vs. 2-3% for Medicare and
Medicaid)
Health Insurance Industry
• Large profit margins
• Loyalty: shareholders (not patients)
• Corruption
Medical Care
• Sponsor luxury care consortiums, clinics
• Facilitate medical tourism
• Participation in “medical transfer
market” (facilitates medical repatriations
of undocumented immigrants - e.g.,
MexCare)
Corporate Agreements with Medical
Associations
• AAP – Abbott Nutrition (manufacturers of
Similac)
• AAP – Babies “R” Us
• AAFP – Coca Cola, Inc.
• AMA – Sunbeam
• AMA – sells access to Physician Masterfile
Pharmaceutical Industry
• Limited innovation
–90% of new drugs little or no better
than existing agents (“me too drugs”)
and only 1% offer improved care for
life-threatening conditions
• Improved somewhat recently
Drug Companies’ Cost Structure
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Manufacturing – 35%
Marketing – 27%
Profits (after taxes) – 18%
R and D – 13%
Taxes – 7%
Pharmaceutical Industry
• Influence over physicians through control of
CME, gifts, research funding
– Over $3.7 billion to at about 366,000
physicians and 900 teaching hospitals in 2014
(excluding research funding)
– Physician Payments Sunshine Act –
reporting requirements
Pharmaceutical Industry
• Conduct seeding trials to alter prescribing
patterns
• Secrecy, statistical torturing of data sets,
selective publication
• Data mining of prescribing practices
• Unethical trials in developing world
• Poor compliance with Clinical Trials Registry
rules
Drug Company Malfeasance
• The pharmaceutical industry is the biggest
defrauder of the federal government, as
determined by payments made for violations
of the federal False Claims Act (FCA)
– Accounted for 25% of all FCA payouts
between 2000 and 2010
– Defense industry – 11%
Pharmaceutical Industry
• Avoided $7 billion in US taxes in 2012 by
shifting profits overseas
• $230 million dollars spent on lobbying in 2014
– 2.3 lobbyisits for every member of Congress
– Revolving door between legislators,
lobbyists, executives and government
officials
Pharmaceutical Industry
• Effectively lobbied and threatened trade
sanctions against developing countries in
order to prevent production and
importation of much cheaper, generic
versions of life-saving anti-AIDS drugs
• Patent extensions
• Promotion of agricultural antibiotic
overuse
PPACA
Patient Protection and Affordability Care Act
• Career arc of Elizabeth Fowler (architect of
plan):
– VP for Public Policy and External Affairs (informal
lobbying) at WellPoint (nation’s largest insurer)
– Chief health policy counsel to Senator Max Baucus
(who drafted legislation)
– Head of Global Health Policy at pharmaceutical
giant Johnson and Johnson
Other Areas of Corporate Malfeasance
• Military-industrial complex
• Energy and chemicals industry
• Law enforcement/prison-industrial
complex
• Payday loan industry
• Genetically-modified crops/biopharming
• Breast milk substitutes
Solutions
• Restructure tax system
• Improve regulation of banks (e.g., enforce Dodd
Frank law)
• Punish corporate scofflaws with large fines and jail
time
– Hide no Harm Act (pending in Senate) would hold
corporate officers criminally accountable if they
knowingly concealed serious dangers that led to
consumer or worker deaths or injuries
Solutions
• Increase enforcement budgets to combat
corporate crime
• Eliminate confidential legal settlements and
confidential business information relevant to
public health and safety
• Eliminate mandatory binding arbitration
clauses
Solutions
• Living wage laws
• Work with corporations
–Benefit corporations
–Healthy PR
–Shareholder activism
–Risks/benefits
Solutions: Fair, Representative Elections
• Publicly financed campaigns and campaign
finance reform
• Open debates, free air time for candidates
• Proportional representation
• Instant runoff voting/cumulative voting/range
(rating) voting
• Halt disenfranchisement, overturn voter
restriction laws
Solutions: Vote
US voter turnout low
Wealthy vote at almost twice rate of
poor
Whites > Blacks > Hispanics
Old > Young
Property owners > Renters
Physicians < general population
Voter Turnout
Solutions
• Activism / Letter writing / Protesting
/ Whistleblowing
• Join community groups – become
involved in local as well as national
issues
• Lobby legislators
• Run for office
Solutions
• Increase funding of public education
• Independent scientific review of school
curricula
• Prohibit use of sponsored curricula
Solutions
• Establish safeguards re corporate
involvement in academic research
• Higher standards of journalism
• Support alternative media
Solutions
• Augment and improve international aid
package
• Sign, ratify, and adhere to major
international treaties
Solutions
• Based on Precautionary Principle
• Recognize nature’s net worth
• Calculate prosperity based on Genuine
Progress Index or Global Happiness
Index, rather than Gross Domestic
Product
• “All men are created equal”
–Declaration of Independence
• “Some people are more equal
than others”
–George Orwell
Voltaire
“The comfort of the rich rests
upon an abundance of the poor”
Hudson River, 2009
Primo Levi
“A country is considered the more
civilized the more the wisdom and
efficiency of its laws hinder a weak
man from becoming too weak or a
powerful one too powerful.”
Günter Grass
“The first job of a citizen is to
keep your mouth open.”
African Proverb
If you think you are too small
to have an impact, try going to
bed with a mosquito in your
tent
Contact Information and References
Public Health and Social Justice
Website
http://www.publichealthandsocialjustice.org
http://www.phsj.org
[email protected]